WASHINGTON UPDATE a series of illegal advance fees as well as misrepresented the cost and effectiveness of its services . The CFPB is seeking to halt the company ’ s harmful conduct and to obtain relief for consumers , including refunds of fees paid to the defendant . The Bureau also released a consumer advisory with tips for consumers who are working to improve their credit history or who are dealing with credit repair services .
The Department of Education announced late last week that it is stripping the powers of one of the nation ’ s largest accreditors of for-profit schools . The Accrediting Council for Independent Colleges and Schools , or ACICS , has been under scrutiny for continuing to accredit colleges whose students had strikingly poor outcomes .
The Education Department also announced that the three-year federal student loan default rate dropped half a percentage point , to 11.3 percent , for students who entered repayment in fiscal year 2013 . This marks the third straight year that the default rate has decreased – for the 2010 fiscal year , the rate was 14.7 percent . The rates are based on the percentage of borrowers who defaulted within three years of repayment . Default rates for public and for-profit colleges dropped in the latest numbers , while defaults among nonprofit college students increased slightly , from 6.8 percent to 7 percent . Meanwhile , nine for-profit colleges and one nonprofit school , mostly small cosmetology schools , could lose access to federal loans after large portions of their students defaulted during the last three years . Default rates at those schools either exceeded 40 percent or were higher than 30 percent for three straight years .
In more bad news for Wells Fargo , the institution reached a settlement with the Department of Justice ( DOJ ) to pay more than $ 4.1 million for repossessing 413 cars belonging to protected service members without getting a court order . Under the settlement , Wells Fargo is to pay each service member $ 10,000 , plus any lost equity in the vehicle with interest ; must repair credit of those affected ; and will pay a $ 60,000 civil penalty . The settlement covers repossessions that occurred between Jan . 1 , 2008 and July 1 , 2015 .
FROM THE INTEREST GROUPS The Bipartisan Policy Commission ( BPC ) has a new paper out on the post-crisis financial regulatory structure : “ Americans have a safer financial regulatory system than before the crisis , but there are some less-than-optimal outcomes and unintended consequences of postcrisis reform that warrant attention , and also regulatory gaps that remain or have emerged since the crisis .” The three main categories of unintended consequences are migration and cessation of activities , binding constraints leading to cliff effects , and regulatory fragmentation leading to duplication and conflict ” Read more .
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National Association of Consumer Bankruptcy Attorneys Fall 2016 CONSUMER BANKRUPTCY JOURNAL 9